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Information provided on this newsletter has been independently obtained from sources believed to be reliable. However, such information may include inaccuracies, errors or omissions. and its affiliates, information providers or content providers, shall have no liability to you or third parties for the accuracy, completeness, timeliness or correct sequencing of information available on this newsletter, or for any decision made or action taken by you in reliance upon such information, or for the delay or interruption of such information. , its affiliates, information providers and content providers shall have no liability for investment decisions or other actions taken or made by you based on the information provided on this newsletter.
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Words of advice like, 'it is good to share' and 'sharing is caring' often come up in conversations, especially when we are spending time with children. Whether it is lunch, toys or sweets-sharing can bring more joy, we like to tell them. While that may be true, it is not always so when it comes to information about your finances. So, while sharing has its benefits, here are five things you should never share with anyone-even your spouse and children.

Card details: Information such as expiry date of your credit or debit card, its number, and your full name are prominently displayed on the card. Your name would be known to most people, but you should not share any other information printed on the card. It is printed there for you, not for others. These details are needed to carry out online transactions. And this information is the first level of security. Without access to it, there is no way to misuse your card. Safeguard these details and don't reveal them to any unauthorised person.

CVV: Every debit and credit card has a card verification value or CVV number on its reverse. This number is vital for completing online transactions. This too is clearly printed on your card, and you should not share it with anyone.

Passwords: If you use net banking or credit cards for online transactions, you know that the transaction cannot go through without confidential details such as your customer identification number, card details and the password. While other details, such as those on your card, may have been compromised without your knowledge; the passwords is completely under your control. Do not tell others about it. And just to be sure, change the passwords at regular intervals.

PIN: Personal identification numbers (PIN) of credit and debit cards are needed at ATMs and merchant establishments to withdraw money and complete transactions. It is a secret number and a vital security feature. Never share it and be careful while using it at ATMs and PoS machines to ensure that nobody is looking over your shoulder to steal this secret from you.

OTP: One-time passwords (OTP) are a more recent second-factor authentication tool, which make your online transactions more secure. When you purchase anything online using your card, net banking or your e-wallet; an OTP is generated and is usually sent to your registered mobile number. This is the last level of authentication, and is applicable only if you have successfully cleared the other security challenges. Should your confidential data be compromised, this is your last defence. If you share it with someone else, the OTP may be used to clean out thousands from your account, instead of the Rs 500 debit you may be expecting.

Therefore, always be suspicious if anyone asks for it. Your bank or financial service provider never will.
In a bid to make health insurance more simple and customer-friendly, the insurance regulator recently amended the definition of pre-existing diseases. The Insurance Regulator and Development Authority of India (IRDAI) said in circular that it deleted ‘the additional/modified clause’ in its current definition of pre-existing diseases. This move could actually help in reducing claim rejection rates in health insurance policies.

To include certain illness under health insurance policy, the regulator had modified the definition of pre-existing disease through a circular in September, 2019. If certain illnesses were diagnosed within 3 months of buying the health insurance policy, those would be considered as pre-existing diseases and covered under the policy, said IRDAI. However, according to the latest circular, no such diseases will be treated as pre-existing diseases even if diagnosed within three months, or later, after purchasing the health insurance. The regulator also mentioned that the modification will be included in the guidelines on standardisation in health insurance policies. Pre-existing disease is a condition, ailment or injury that already exists at the time of buying a health insurance policy. Conditions like diabetes, epilepsy, lupus, sleep apnea, depression, anxiety are considered as pre-existing health conditions. IRDAI also modified the existing definitions of pre-exiting diseases that are not applicable for overseas travel insurance. Here are the changes Pre-existing disease means any condition, ailment, injury or disease:

Old definition: The illnesses that are diagnosed by a physician within 48 months prior to the effective date of the policy issued by the insurer.

New definition: The illnesses that are diagnosed by a physician within 48 months prior to the effective date of the policy issued by the insurer or its reinstatement.

Old definition: For which medical advice or treatment was recommended by, or received from, a physician within 48 months prior to the effective date of the policy or its reinstatement.

New definition: For which medical advice or treatment was recommended by, or received from, a physician within 48 months prior to the effective date of the policy issued by the insurer or its reinstatement All the insurers and third-party administrators are advised to make a the changes and ensure compliance, wherever applicable, with immediate effect, said IRDAI.

If you have been following the budget proposals that may affect you, there’s a good chance that you are confused about what you should be doing. Your decisions can have a bearing on your financial plan, so it’s better not to be impulsive. Here are three budget-related decisions you shouldn’t make in a hurry to ensure you don’t harm your financial situation in the long run.

Tax regime selection

Choosing a lower tax rate may seem like a no-brainer but evaluate if it really works for you. If you select the lower slab, you will have to give up on a lot of deductions that could help reduce your taxable income. The straightforward standard deduction, the popular deductions under Section 80C, exemptions on house rent allowance, leave travel allowance (LTA) and others, and the deduction on interest paid on home loans are some of the benefits you’ll need to forgo. On the other hand, assuming that the old tax regime works well for you, without taking the trouble to see if the deductions you are claiming really add to your financial well-being, is also harmful. If you have committed yourself to insurance policies that you don’t need, or invest each year just to avail of tax benefits, then it may be time to sit down and evaluate if they add value to your portfolio. Do the math and see what works for you before you decide.

MF dividends taxation

The dividend you earn from your mutual fund investments will now be taxed at your slab rate. Earlier, the dividend was tax-free in your hands but the mutual fund deducted a dividend distribution tax (DDT) at a rate of 11.2% for equity-oriented funds and 29.12% for debt-oriented funds. With this change, the tax implication for those in the higher tax brackets goes up significantly, especially in equity funds. An investor in the 30% tax bracket will now be paying tax on dividends at 31.2% (including surcharge and cess) as against 11.2% earlier. The higher tax can have a significant impact on your long-term corpus. Look at structuring your investments differently to protect your corpus. Choose the growth option where there is no tax bleed till redemption. If you need regular payouts, whether to meet expenses or to move gains to other investments from a diversification point of view, use a combination of the growth option with a systematic withdrawal plan instead of the dividend option in a debt fund. Every withdrawal will face capital gains tax but it will have the benefit of indexation if the units are held for more than three years and this will bring down the tax incidence significantly.

Exiting investments

Opting out of long-term investments that earlier gave you tax benefits just because you can now avail of lower tax rates without them may not be financially prudent. Individuals who choose to go with the new tax dispensation should make sure they don’t compromise on their savings. You should use the opportunity to weed out all the unsuitable investments you were making just for the tax benefits, particularly those that were not in sync with your asset allocation.

People should start saving consciously depending on what they need from their money and how they need to use it and take a more educated call rather than being disciplined like little children. Build the discipline that you had for tax-saving instruments for the new investments. The impact of the changes proposed in the budget will be different for each of you. There is no one-size-fits-all solution. Understand the choices and then initiate the changes for the best outcome.

Life is uncertain and no matter how steady you feel you are, a financial crisis can leave a big impact on your personal finances and throw your future plans off gear. While this is not to say that you should have a pessimistic outlook towards life, being prepared for a financial crisis can indeed help in more ways than one. In fact, if you have your feet planted firmly on the ground, as far as your finances are concerned you can weather any storm! Here are some tips that you can use to plan for a financial crisis.

Begin with a budget
The first step towards getting a hold over your finances is making a budget. If you do not have a budget to live by chances are you are overspending and have even taken on excessive debt. For instance, you may have taken a personal loan to purchase one or more gadgets, just because you were taken in by attractive personal interest rates. While a budget cannot things magically, it is useful tool to determine where you stand financially. It will also be an indicator of where your funds are being directed. While you have to fulfil existing debt obligations including your personal loan like the one mentioned above, there are indeed other places where you can cut corners. For instance, if you have a subscription for a magazine that your hardly read or going out with friends almost every weekend, you know for certain that these are surplus expenses that you can do without. Making these small changes in your daily financial habits can make a big difference to your finances and even ensure that you do not find a place in the loan defaulter list of a bank.

Create an emergency fund
Once you have a hold over your finances with a budget, it is time to create a contingency fund to last you at least 6 months to a year in case of any financial crisis. These funds should be enough to help you meet all your regular expenses for the above mentioned time frame. Instead of leaving these funds idle in a savings account, you can consider investing in a liquid fund that provide a higher rate of interest and also provide you the required liquidity to withdraw funds in the face of a crisis. The greatest advantage of creating and replenishing your emergency fund periodically is that you will not have to worry about fulfilling your debt obligations even in the face of crisis and live in fear of ending up on the loan defaulter list.

Maintain a good credit score
Your credit score is a barometer of your financial health. If you have a good credit score, you not only feel in better control of your finances, you also enhance your chances of obtaining a line of credit when you are in most need of it. There are instances in life, where despite your best attempts to remain prepared you are faced with a sudden financial crunch. At times such as these, a quick loan at attractive personal loan interest rates will come handy if you maintain a good credit profile. You can maintain a good credit score, by simply making it a point to make timely repayments on your existing lines of credit and maintaining a good balance between secured and unsecured credit. Too many unsecured lines of credit such as personal loans and credit cards may be detrimental to your credit health.

Look for an extra stream of income
Lastly, but not the least, if you have a talent or a knack that you know you are not making the most of, use it to earn a extra income. For instance, you can take up work are a freelance graphic designer or website developer if you are really good at it for making that extra bit of income that you can use to beef up your emergency fund. With the explosion of social networks and the expanding need of digital content for professionals procuring these extra jobs is a tad easier in this day and age.
Please mark all your queries / responses to
Information provided on this newsletter has been independently obtained from sources believed to be reliable. However, such information may include inaccuracies, errors or omissions. and its affiliates, information providers or content providers, shall have no liability to you or third parties for the accuracy, completeness, timeliness or correct sequencing of information available on this newsletter, or for any decision made or action taken by you in reliance upon such information, or for the delay or interruption of such information. , its affiliates, information providers and content providers shall have no liability for investment decisions or other actions taken or made by you based on the information provided on this newsletter.